Hungary’s Orban Spooks Investors Again by Micromanaging Economy

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(Bloomberg) – The men of the Hungarian ministers are once again raises investors by interfering in the economy spaces from banks to management before the elections next year.

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The stocks in Budapest suffered the largest decrease in two days in nearly eight months after the Minister of Economy Marton Nagy suggested the freezing costs imposed by banks on customers, while urging “voluntary” price discounts by telecommunications companies and restricting margins by retailers of food.

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This attack followed the market intervention new rules, forcing institutional investors to purchase more government debts and prompted the memories of the past to the previous market foals during the 15 years of Orban. His mandate began with billions of dollars in seizure of the state in the assets of private pensions, before entering a series of target industry taxes, and foreign investors often secrete.

“This market is only suitable for black investors,” said Gabor Bukta, a Concorde mediation analyst, referring to the rapid reactions needed to move in unexpected organizational changes.

The government, which is shown by the most reliable opinion polls, is trying to curb up next year, to curb the prices of a wide range of elements of Strudel flour to banking transactions fees.

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The growth price growth may eventually allow the central bank to reduce the highest interest rates in the European Union, although the new ruler Mihaly Varga pledged to maintain fixed borrowing costs.

Botka said Magyar Telekom Nyrt. It is a unit of Deutsche Telekom Ag, which may significantly decrease as a result of government ads, which expects a reduction of at least 10 % in the fees that service providers can fees on customers. The stocks in Magyar Telekom fell more than 7 % on Monday, more than five years.

The lack of prediction's ability to worry about the foreign exchange market, according to the economists in the American America Corp. , Forint weakens against the euro during the past week, while bond returns for 10 years reach the highest level since 2023.

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Forent Feelings

“We do not believe that the last government measures are specifically aimed at establishing a space to motivate the speed that investors explain,” May Duan of Bofa said in a note on Tuesday. “However, repeated regulatory changes increase the high uncertainty, which undermines the morale of Forent.”

Duan said that while the Urban Fidban party will try to avoid excessively stabilization of Forent before 2026, investor morale is still fragile. They are forced to react as opposition leader Peter Magear who benefited from a cost -cost living crisis and corruption allegations on a large scale.

In a statement on Tuesday, Naji said that restrictions on retail food margins had already been successful, as more than 800 elements are now available at lower prices. Bofa said the food cover “is scheduled to lead to a sharp decrease in inflation.”

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Previous interventions of Europe in specific markets included forced energy price discounts, and Suddiner Refiner Mol Nyrt. With additional taxes, acquisition of facilities and export on building materials. As a result, investors demand a discount on the shares listed in Budapest, relative to their regional peers as well as the emerging MSCI index.

Peter Ferrovak, an economist at Eng, said in Budapest, said the government is now focusing on curbing inflation because this may be a decisive factor for the upcoming elections. However, the moves may come in reverse results regarding the $ 200 billion in Hungary's economy, if not in the shorter term, then beyond the road.

“The more the government -run areas, the more difficult it is to keep it under control,” said Ferrokz. “If these price covers are suspended for a longer period, you will lead to a worse service quality, a lower degree of investments and profit reduction.”

– With the help of Marton Cassenic.

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